“This edition marks the first time that Australia (21st, down one) exits the top 20 and is overtaken by New Zealand (18th), which jumps five places," the report said.

While the WEF praised Australia for placing No. 7 in the financial market development sub index, or “pillar"; the Forum noted that area was the “only pillar where it features in the top 10".

AFR
AFR

Australia also got “very good marks for higher education and training" and for slashing its public debt-to-GDP ratio to the third-lowest among advanced economies, trailing only Estonia and Luxembourg.

“The main area of concern for Australia is the rigidity of its labour market," where it slipped 12 spots on the list to place No. 54 among world nations. “The situation has deteriorated further," the report said.

“Australia ranks 137th for the rigidity of the hiring and firing practices and 135th for the rigidity of wage setting," it said.

“The quality of Australia’s public institutions is excellent except when it comes to the burden of government regulation, where the country ranks a poor 128th. Indeed, the business community cites labor regulations and bureaucratic red tape as being, respectively, the first and second most problematic factor for doing business in their country.